Answer to Question #90545 in Microeconomics for Mtura

Question

An individual’s labour supply curve is positively sloped when:

Answer 1

The wage rate increases

Explanation

The individual supply of labor is dependent on the wage rate. Thus, when the wage rate increases, individual labor will supply more working hours as compared to before the rise. This is because, the higher wage rate will attract people to work more hours in that occupation and the individuals will also move to the city that the wages in a particular occupation are higher. This will therefore lead to an individual’s labor supply curve to slope positively.